Do I Need to Continue Paying Mortgage During a Naperville Short Sale?

Do I Need to
Continue Paying
Mortgage During a
Naperville Short
Sale?

Do I Need to Continue Paying Mortgage During a Naperville Short Sale?
When you consciously or knowingly stop
making mortgage payments, this is called a
strategic default. Many people believe that a
strategic default can accelerate their Naperville
short sale, but this is not always true.

Whether or not you continue to make mortgage payments
and HOA dues is a personal decision that can only be made
by the borrower — not the lender or real estate agent.
To help you make an informed decision, you need to
understand both the advantages of continuing your mortgage
payments as well as the consequences of late mortgage
payments.

Late mortgage payments can negatively impact your credit score
and, as a result, can also impact your ability to obtain a loan in the
future.
Contrary to popular belief, you don’t have to default on your
mortgage payments in order to qualify for a Naperville short sale.
The Home Affordable Foreclosure Alternatives (HAFA) program
has released new guidelines that allow borrowers who are current
on their mortgage payments to do a short sale.

As for HOA dues, unpaid HOA fees can kill your short
sale deal. Short sale lenders refuse to pay the seller’s
unpaid HOA balance. They will usually contribute a
small amount for HOA document and transfer fees,
but that’s it. It’s better to continue paying your HOA
dues even during a short sale.

There are many advantages if you continue to make your
mortgage payments:
1. Protect your credit score.
Being current on your mortgage payments protects your credit
score because late payments will not be reflected on your credit
report. However, your credit score may still drop by a few points
due to a short sale and the lender may still report your Naperville
short sale as “settled less than full.”

2. Shorter waiting period for buying another home.
Depending on the type of loan, the waiting period to get a new
home loan and buy another home is 2-3 years after the short sale
was completed. Fannie Mae and FHA allows short sale sellers to
obtain a new loan immediately after a short sale on the condition
that the borrower was never late on mortgage payments, which is
another advantage of being current on mortgage payments.

3. Cancel without penalty.
In the event that you fail to sell your home as a Naperville short
sale or if the lender does not approve the buyer’s offer, you can
cancel the listing without liability and keep your home.

4. Peace of mind.
Being current on your mortgage payments will help you sleep
better at night and avoid the stigma of being delinquent. Having
one less thing to stress about makes it easier to deal with the
complicated short sale process.

There are more advantages of being current on mortgage
payments during a short sale. Although, there are instances when
the homeowner could no longer continue making payments due to
financial hardships or extenuating circumstances that are beyond
their control.
If you plan on doing a Naperville short sale, make sure to work
with an experienced Naperville short sale agent who has your
best interests at heart and can help you arrive at an informed
decision.

If you are ready to do a Naperville short sale call
me, Teresa Ryan at 630-276-7575. As a certified
distressed property expert and Broker/Owner of Ryan
Hill Realty, I have the experience and tools to help you
sell your Naperville short sale home. Visit
www.RyanHillCanHelp.com for more information on
short sales and foreclosures.

Do I Need to Continue Paying Mortgage During a Naperville Short Sale?

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Do I Need to Continue Paying Mortgage During a Naperville Short Sale?